Why not?
The substitution they do is <a href="%s">, and you can "game that" by inserting 'http://foo.com> other stuff goes here <whatever foo="">' Fine. The literal HTML that the user sees becomes '<a href="http://foo.com>other stuff goes here <whatever foo="">'. That's bad.
Now if you escape that properly, you get: '<a href="http://foo.com&quot;&gt; other stuff goes here &lt;whatever foo=&quot;">' Garbage, but not a security problem.
(BTW, news.arc fucks up the escaping too, so this example is garbage. Sorry. See nopaste here: http://scsys.co.uk:8001/33063
Edit: sigh, that is also broken! Bottom line; none of these things will happen to you if you replace every & with &amp;, every " with &quot;, every ' with &apos;, every < with &lt; and every > with &gt;.)